Saturday, October 3, 2020 / by Rick Devine
Buying New Construction
What do you look for when you are searching for a home? Do you love a house with all of the latest technology and a host of exciting, up-to-date bells and whistles or do you prefer architectural touches from a bygone era? Do you love imagining the people who lived there before or do you want to consider your new home a clean slate? Are you captivated by the history of a property or are you more interested in the history you’ll make there?
Depending on your wish list and your personality, you may find that a new construction home offers better options than the resale of an existing property. This is especially true if you are looking for customization options geared toward your family’s particular preferences. Buying new construction isn’t for everyone, however, and it’s important to think through the pros and cons of the process.
What follows are some of the advantages and disadvantages of building your next home, rather than buying an existing property. Consider your goals, your preferences, and your lifestyle as you think through the options and choose the right home for you and your family.
Advantages of buying a new construction home
For some people, new construction is the only way to go when it is time to buy a home. Whether you’re in that camp or just looking for an alternative to the current resale market, there are a few distinct advantages to moving forward with a new home build.
An answer to low inventory
In markets around the country, low inventory has driven up home prices and turned most real estate transactions into multiple offer scenarios. The advent of COVID-19 has exacerbated this problem, making even less desirable properties and markets hot commodities. With a new construction home, you can avoid wrangling over a property that may not be your dream home to start with.
With new construction, much of the uncertainty is taken out of the equation, and as long as there’s a lot available in your chosen community you know you’ll get the house. Your builder will then be able to give you a fair estimate of your expected timeline so that you can plan your move-in date. In addition, the flexibility of new construction may allow you to truly build the home you’ve envisioned rather than looking for that magic dream home on the resale market.
No worries about old systems
One of the reasons the home inspection process is so nerve-wracking for home buyers is because they fear buying someone else’s problems. Older systems or systems that have been improperly maintained, along with deferred maintenance and hidden damage can make it a bit intimidating to buy a resale property.
By contrast, new construction offers you a baseline wherein all of the systems, fixtures, and appliances are brand new at the same time. That gives you several years of worry-free, low-maintenance living, along with a clearer idea of the replacement horizon for the home’s systems, appliances, and fixtures.
New technology and materials
With a new home, you can take advantage of the benefits offered by newer construction materials and new technology to create a home that is more up-to-date and energy-efficient than any resale home could be. Smarter building methods, greener building materials, and more energy-efficient systems and appliances not only save you money but may mean that your home is healthier than an older home as well.
Disadvantages of buying a new construction home
While you may be excited at the idea of a new construction home, for some homeowners there is nothing like the history and overall feeling associated with an older home. In addition, there are a few ways in which a new construction home may present challenges.
Lack of mature landscaping
Many new construction communities feature little or no mature landscaping, with small, stunted trees and immature lawns. If you favor the insulating and environmental benefits of tree-lined streets and residential lots, you may want to look for an existing home in a more traditional, older neighborhood. Alternatively, you may want to consider buying a lot in an older neighborhood, and then hiring a custom builder rather than buying in a completely new community.
Not all builders are the same
While a new construction home can offer years of peace of mind, that’s only when the builder and construction team are competent and reliable. Unfortunately, not all builders are created equal and you could find yourself struggling with unfinished interiors and poorly installed systems. Your real estate professional should serve as your guide to the most skillful, reliable builders in your local market.
Lack of bargaining power
If you’re looking for a bargain on your home purchase or if you love the excitement of negotiating your purchase price, you will not get much satisfaction out of a new home purchase. Here, the costs are fairly standardized and you will have little bargaining power in regard to the cost of the home. You may be able to negotiate some of the extras and upgrades.
Talk to your real estate agent or broker about the process of buying a new construction home. You’ll want an agent’s representation throughout the process, especially as you consider financing scenarios, builder contracts, and other aspects of the transaction.